B. U. Keyser, Receiver, vs. Jane C. Hitz

B. U. Keyser, Receiver, vs. Jane C. Hitz. At Law. No. 22,261. J Decided June 26, 1883. i Justices Hagnee, Cox and Jambs sitting. 1. The act of Congress of June 30, 1877 (19 St., 94), is substantially an enactment that the acts of Congress relating to national banks, including the provisions of Section 5154, providing for the conversion of banks into national banks, shall be applicable to savings and other banks in this District, except that savings banks existing at the time of the passage of the act are not required to have a capital of $100,000 in order to be converted into national banks. It was competent, therefore, for a savings bank organized in this District under the General Incorporation acts of May 5 and June 17, 1870 R. S. D. C., § 553, to avail itself of the law for converting banks into national banks. '2. The certificate of the Comptroller of the Currency is conclusive as to the regularity of the proceedings by which any bank has been converted into a national bank. 3. Where a shareholder of a corporation is called upon to respond to a liability as such, he is not permitted to deny the existence of such corporation. 4. Where the owners of more than two-thirds of the stock of a bank consent to the conversion of the bank into a national bank, such a conversion may take place without the concurrence of the remaining stockholders. 5. While it might be more regular, on the conversion of a bank into a national bank, for a new stock book to be opened and new certificates to be issued in the name of the national bank, yet as there is nothing in the law prescribing the form of the stock book, or of the certificates of stock, there is nothing to preyent the new bank from treating the old books and certificates as sufficient evidence of title in the concern; neither the rights nor liabilities of the stockholders could be affected by the mere omission to issue a new form of stock certificate to them. To hold otherwise would be to allow all the stockholders to escape liability by the mere omission of the formality of issuing the shares in a new form. 6. Where a stockholder of the old bank has given his consent that the stock should be converted into stock of the national bank, he becomes by virtue of that consent a stockholder in the new bank, notwithstanding any omission to issue new certificates of stock. 7. Under the Married Woman’s Act of 1869, R. S. D. C., the right of a married woman to hold bank stock, acquired by her during marriage, otherwise than by gift or conveyance from her husband, is as absolute as if she were unmarried; she can convey, devise and bequeath it in the same manner and with like effect as if she were unmarried, and may contract, sue and be sued in her own name, in all matters having relation to it; she is also amenable to all the consequences of its ownership and of its conversion into national bank stock, including the individual responsibility of stockholders, in the same manner as if she were a feme sole. 8. Where the wife acquires property by gift or conveyance from her husband, she holds it, as she would at common law, with a qualified . property in her husband, being unable to assign it without his consent ; and she is liable, if it is a chose in action, to have it reduced to his possession. 9. Stock of an incorporated company is a chose in action. 10. Where a married woman holding savings bank stock derived by gift or conveyance from her husband agrees with his consent to convert the stock into national bank stock, she thereby regularly and legally acquires title to the latter stock; and although she still holds the new stock subject to the marital rights of her husband, she is nevertheless subject to the individual responsibility of national bank. stockholders, and may be assessed for all losses and be compelled to pay out of her other estate to the amount of the par value of her-stock. 11. It seems, however, that it might be otherwise if the transfer of the stock to her and its subsequent conversion were made without her knowledge or consent.. 12. The liability incurred by a holder of national bank stock, to be assessed to the amount of the par value of the stock for all losses of the bank, is a statutory liability, and not a contract one. It is a liability imposed by the statute as an incident of the ownership of the stock, and attaching to all who are capable of that ownership, without reference to any supposed voluntary assumption of the liability by express or implied contract. Therefore, where national bank stock is held by a feme covert, either in her own right or subject to the common law marital rights of her husband, the liability to be assessed affects her alone, and a suit to enforce the collection of the assessment is properly brought against her without joining her husband, as would be necessary in the enforcement of any common law obligation or liability of the wife. The Case is stated in the opinion. Elliot & Eorinson for plaintiff: The National Bank Act provides that such banks may be formed by any number of natural persons not less than five, upon the conditions therein prescribed ; Rev. Stats., sec. 5133 ; and that any bank incorporated by special law, or any banking institution organized under a general law of any State, may become such a national association Id., sec. 5154. An act of June 30, 1876, further provides (19 St., p. 64), that all savings banks and trust companies organized under authority of any act of Congress shall be required to publish all the reports which national banking associations are required to make and publish, and shall be subject to the same penalties ; and all savings or other banks now organized,- or which shall hereafter be organized, in the District of Columbia, shall be subject to all the provisions applicable to national banks. The general incorporation law in force in this District also provides for the individual liability of all stockholders in any company organized under its provisions to the amount of the stock of each stockholder. Bev. Stats., § 574. It is submitted that the national bank.act is a general statute of the United States .providing for the organization of national banks by all persons and in all places subject-to the legislation of Congress, wherein it could not possibly have, been intended to discriminate against the District of Columbia. In the organic act of this District it is enacted that “all the laws of the United States, which are not locally inapplicable, shall have the same force and effect within the said District of Columbia as elsewhere within the United States.” In Page vs. Burnstine, the question was whether the statute, which declares that in actions by or against execu-' tors, &c., neither party shall be allowed to testify against the other as to any transaction, &c., applied to the courts of the District of Columbia as fully as to the circuit and district courts of the United States. The language used by the Supreme Court in that case would have to be modified v.ery little to dispose completely of the point made by the plea under consideration. “ The same considerations of public policy, which would require the enforcement of such a statute as that of March 3, 1865, in the circuit and district courts of the United States, without regard to the laws of the respective States on the same subject, would suggest its application in the administration of justice in the courts of this District.” 102 U. S., pp. 667,668. Irrespective, however, of any force or want of force in these views the Supreme Court of the United States has passed judgment on the identical plea in another case, in terms which can hardly fail of application to the present one. In Casey vs. Galli, the 2d plea was that there was no such corporation, because the Bank of New Orleans had no power by its charter, nor authority otherwise from the State of Louisiana to change its organization to that of a national banking association under the laws of the United States; and the 3d, that there was no such corporation, because the-owners of two-thirds of the capital stock, of the Bank of New Orleans did not authorize the bank to be converted into a national banking association under the laws of the United States — wherefore, by both pleas, it was prayed that the declaration be quashed. Held — “the pleas were properly in abatement and not in bar.” And, 2d, “the piea proposes to go behind the certificate and contradict it. This cannot be done. The comptroller was clothed with jurisdiction to decide as to the completeness of the organization, and his certificate is conclusive upon the subject for all the purposes of this litigation. It has the same effect, and for the same reason, as his determination and order with respect to the amount to be collected from each stockholder in the event of the failure of the association. No question can be raised in this collateral way as to either.” It is added : “ There is another ground upon which both pleas must be held bad. Where a shareholder of a corporation is called upon to respond to a liability as such, and where a party has contracted with a corporation, and is sued upon the contract, neither is permitted to deny the existence or the legal validity of such corporation ; to hold otherwise would be contrary to the plainest principles of reason and of good faith, and involve a mockery of justice. Parties must take the consequences of the position they assume. They are estopped to deny the reality of the state of things which they have made appear to exist, and upon which others have been led to rely. Sound ethics require that the apparent, in its effects and consequences, should be as if it were real and the law properly so regards it.” 94 U. S., pp. 678, 679 and 680; Hadly vs. Baker, 20 Wall., 650; Wheelock vs. Rost, 77 Ill., 296; Huffaker vs. Bank, 12 Bush., 287. Finally, it will be observed that the Supreme Court, in the case cited, decides the plea to be one in abatement. Such is its character in point of fact, however it be pleaded. As such it is a nullity when put in after a plea in bar, or after an ordér to plead an issuable plea. Palmer vs. Green, 1 Johns Cas., 101; Engle vs. Nelson, 1 Pen Watts, 443; Chamberlain vs. Hite, 5 Watts, 373; Tavis vs. Hitner, 9 Barr., 447; Kilwick vs. Maidman, 1 Burr., 59; Bernham vs. Webster, 5 Mass., 268; Shepherd vs. Graves, 14 How., 510; Martin vs. Com., 1 Mass., 358; Eaton vs. Whitaker, 6 Pick., 465; Lyman vs. Albee, 9 Verm., 508; Malone vs. Clarke, 2 Hill, 658; Howard vs. Rawson, 2 Leigh, 733; Good Intent Co. vs. Hartzell. In the light of these authorities, and of the facts of the present case, it is submitted that the only real issue presented to the court is whether a married woman is exempted by the fact of coverture from liability as a stockholder in a national bank. The construction of a shareholder’s liability, under the national bauk act, leaves very little room for its evasion. That liability is fixed when the stockholder becomes a member of the corporation, by taking stock therein, and is several and not joint. Bailey vs. Sawyer, Thompson’s National Bank Cases, 356. A person who appears upon the books of a national bank as the legal owner of shares of its stock is, upon the failure of such bank, liable for the debts of the association to the extent of the shares held by him, although he received and holds such shares as collateral security for a loan to a shareholder. Hale vs. Walker, 31 Iowa, 344. Persons who hold stock of a national bank in pledge, the certificates of which stand on the books of the bank in the name of the pledgee, are, in contemplation of the national banking act, stockholders, and so long as they thus hold the stock in pledge, are responsible to the creditors of the bank in proportion to the amount so held. Magruder vs. Colston, 44 Md., 349. And see, Johnson vs. Laflin, 5 Dil., 65; Moore vs. Jones, 3 Woods, C. C., 53; Young vs. Vough, 23 N. J. Ex., 325. A person who allows a transfer to be made to him upon the books of a national bank of shares therein, even though such transfer is made solely as security for a debt due the transferee, is liable as a shareholder, under U. S. Rev. Stat., sec. 5139. Moore vs. Jones, 3 Wood, C. C. 53. Enoch Totten for defendant: First. There was no authoi’ity for the conversion of the “ Saving Bank ” into a “ National Association,” as was attempted May 14th, 1877. The forty-fourth section of the act of June, 1864, the original law establishing the national bank system, applies only to “ banks incorporated by special law” of any State, or “ any banking institutions organized under a general law ” of a State. It cannot be successfully argued that these terms can include “ savings banks ” in this District, organized in pursuance of the authority and powers of the general law of Congress, governing the organization of such institutions in the District of Columbia. This latter act was passed May 5, 1870, and was made to include savings banks, June 17th, 1870, and about six years after the National Currency Act went into operation ; this German American Savings Bank was organized September 24th, 1872. The authoritj'- produced by the plaintiff for the creation of this national bank consists solely of a document, dated May 7, 1877, purporting to be signed by stockholders of the savings bank, empowering the trustees thereof to convert it into a national bank, “ under the sections of the Revised Statutes which authorize the conversion of Slate hanks into national associations” (Sec. 5154), and “to make and execute the articles of association and organization certificate required to be or contemplated by said statutes;’’ and to execute all papers, and do all acts necessary to be done “ to convert said German American Savings Bank into a national banking association,” and to transfer the assets to the proposed national bank, &c. 17. There was no evidence that anything beyond this was done, except that on the 14th of May, 1877 (20), a public proclamation was made announcing the existence of the national bank, and its authority to commence business. This certificate, in its form, follows the provisions of section 5154, relating to conversion of State banks. None of the proceedings seem to have been taken under any of the other provisions relating to the formation of national banks. See Secs. 5133-4-5-6 R S., p. 996. No aid for this extraordinary assumption of power can be derived from the Act of June 30th, 1876. The most that can be di’awn from that act, in this direction, must come from the concluding provisions and language of the sixth section ; these declare that savings’ bank or other banks in this District “shall be subject to all the provisions of the revised statutes and of all acts of Congress applicable to-national banking-associations, so for as - the same may be applicable to such savings or other banks.” It is plain that no change in the character of these institutions was here contemplated ; — the acts of Congress mentioned are to govern so far as the terms thereof may be “ applicable ” to such institutions and no farther ; those parts of the acts which may be inapplicable to “ savings ” or to that system, shall not apply. This is the plain interpretation of the statutes. Instead of contemplating the dissolution or destruction of savings banks, the legislation clearly intended their presex*vation and protection, as well as to guard the interests of depositors. The only operation of the law of 1876, requiring reports and examinations, was to give to the Comptroller of the Currency a general supervising power and guardianship over them. This is plain from the proviso of the Act of 1876, which declares that “savings banks” then existing, should not be required to have a capital of over $100,000. The primary characteristics of savings-banks are (1), the capitalization of interest on the sums deposited; (2), the holding of those sums at call, with or without previous notice, as the rules of the particular institution may prescribe. Webster defines savings-bank as follows: “A bank in which savings or earnings are deposited and put to interest.” It will not escape notice that the business, prescribed and limited for the national banks, is wholly inconsistent with the.idea of “savings” banks ;■ in the “savings bank” system the capitalization of small earnings or savings is the ruling principle ; these earnings or savings are concentrated by the savings bank, and are invested in permanent securities, being either in real estate securities or in Government or other bonds. The general statute authorizing the creation of “ savings banks ” and other corporations in the District of Columbia, • B. S. D. C., § 553, provides that upon making and filing the certificate prescribed by the act, the persons “ shall be a body politic and corporate in fact and in name ; ” may sue and be sued ; have perpetual succession ; have a seal ; adopt rules and regulations ; purchase, hold and convey real and personal estate necessary to carry on its “ operations named in ” the certificate, &c. National banks are authorized by law, (B. S., 5133) to “ carry on the business of banking ; ” the law requires that the certificate shall state the town, the place where the operation of “ discount and deposit ” shall be carried on, the amount of capital stock and the number of shares. The “ business of banking,” as defined in the B. S., sec. 5136-7 to consist in discounting and negotiating notes, drafts, bills, and other evidences of debt, receiving deposits, buying and selling exchange, coin and bullion, loaning money on “personal security,” circulating its notes, &c. They are forbidden by law to lend money on real estate, or to hold real estate, as security, except for previously contracted debts § 5137. The two systems of business are wholly different, and are intended to subserve entirely different objects and ends. These considerations, it should seem, conclusively establish the correctness of the interpretion of the sixth session of the Act of 1876, contended for by the defendant — that is to say, that those provisions were to affect savings banks only so far as they were applicable to the “ savings ” principle. Applying to this transaction the familiar rules, which apply as well to corporations as to public officers, that no powers will be presumed except those which follow necessarily from the general grant of power, it will be' difficult to ■find any statutory authority for the existence of this National Bank. See Morrill vs. Jones, 106 U. S. 466. If the defendant is liable at all, it must be under the provisions of the geueral incorporation act of the District of 'Columbia. Second. Mrs. Ilitz never bought or paid for a single share of this stock, and the transfer of the stock, which appears on ■the'books in her name, was a fraud. It will be observed that there was no stock issued to or held by the defendant in the alleged national bank ; all that ■was done was to make an attempt to transfer to her name, on the books of the savings bank two hundred shares of the-■savings bank stock ; no change was made, or attempted, as to ■the character of the stock. Even if the conversion or attempted change of the character of the institution was ■lawful, no part of the statute converts the stock of the original bank into stock of the new institution ; all that the Currency Act permits (as to State banks), is that the shares * * may continue to be for the same amount * * * as they were before the conversion. The only evidence that the defendant ever had any knowledge of this transfer of savings bank stock, offered at the trial, consists in three dividend cheeks, payable to her order, -and endorsed by her to her husband, to whose credit the amount of each check was passed ; also the document purporting to be signed by stockholders of the savings bank, authorizing the trustees of that institution to cause- the savings bank to be converted into a national bank. This document purports to have been signed by the defendant. There was no effort made, and no evidence offered to show that the defendant signed either of these four documents. Although this “ national bank ” was in operation for more than a year, no dividend checks were ever issued to the defendants upon stock of that bank. There was not a word of proof offered to show that she ever had any interest in such ■bank stock. Third. If the court should be of opinion that the defend-ant is bound by this record, then it is submitted that the largest part of the stock — to wit, $17,300 — was the property of the defendant’s husband, and was taken by her, if at all,, by “ gift or conveyance from her husband.” The law of the District, as to married women, being the act of April 10, 1869, is as follows : “ In the District the right of any married woman to any property, personal or real, belonging to her at the time of' marriage, or acquired during marriage in any other way than by gift or conveyance from her husband, shall be as absolute as if she were unmarried, and shall not be subject to the disposal of her husband, nor be liable for his debts. “ Any married woman may convey, devise and bequeath her property, or any interest therein, in the same manner and with like effect as if she were unmarried. “Any married woman may contract, sue and be sued, in her own name, in all matters having relation to her sole and separate property, in the same manner as if she were unmarried.” R. S. Dist. of Columbia, Secs. 727-8-9. This statute relates to the “ sole and separate property ” of married women, acquired either before marriage or after marriage, if it be not through “gift or conveyance” from her-husband. The transaction involved in this case, upon any theory, lacks two essential ingredients to bring it within this-statute, and to hold the defendant to liability: 1. This stock is not in any sense the “sole and separate-property ” of the defendant. 2. It was either a “gift” or a “ conveyance ” from her husband, if it was anything. See Ritch vs. Hyatt, 3 Mac Arthur, 538; Sykes vs. Chadwick, 18 Wall., 141. The bond or other contract of a married woman is, at common law, absolutely void — not voidable. Agricultural Bank vs. Rice, 4 How., 225. This act of June, 1864 (the National Currency Act), did not change, but was made in contemplation of, the common law. The Married Woman’s Act, in force in this District, was approved and became a law April 10,1869, long after the Currency Act, and hence must be held to govern, if the-two acts are in conflict as to any parts. The shareholders of every National Bank are to be held individually responsible, equally and ratably, and not one for another, for all contracts, debts and engagements of such association to the extent of the amount of their stock therein at the par value thereof in addition to the amount invested in such shares. At common law, except in several well known cases, a married woman could not bind herself by contracts, nor has her general power in this respect been enlarged by statute. Where it is sought to charge her with contract liability by the provisions of any statute, it must clearly appear that such statute conferred upon her power to engage the liability, and such statute will be construed strictly. No such power will be inferred from language that does not expressly confer it. A case has recently been decided in the Supreme Court of Pennsylvania which illustrates these principles. In Wallach et ux. vs. The Lehigh Building Association, 3 Norris, 211, it was decided that a married woman was incapable of incurring the liabilities she undertook to assume by becoming a member of a building association ; it was held that she was not liable for the dues and fines of her share of stock, nor for money that she had borrowed upon them. The authorities on this subject are fully corrected in a recent book. Husbands on Married Women Chapter 7; see also Rice vs. R. R. Co., 32 Ohio St. Substantially the same doctrine has been repeatedly recognized and adopted in the federal courts. A paper executed under seal for the husband’s benefit .by husband and wife, acknowdedged in separate form by the wife, and meant to be a mortgage of her separate lands, but with blanks left for the insertion of the mortgagee’s name and the sum borrow'ed, and to be filled up by the husband and given to a lender of money, though bona fide, and without knowledge of the mode of execution, the mortgagee, on cross-bill to a bill for foreclosure, was directed to cancel her name. Drury vs. Poster, 2 Wall., 24. The bond of a married woman is void, and the promise of a feme covert is void. Agricultural Bank vs. Rice, 4 Howard, 225; Watson vs. Dunlap, 2 Cr. C. C., 14. By the common law, a married woman could not bind herself, or render her separate estate liable. Where such power is given by statute, it is only to the extent conferred by the act which is to be strictly construed. Boyd vs. Withers, 1 Chicago Leg. News, 401. Congress has, in a recent act, deemed it necessary to use express wmrds to make a married woman, liable upon her obligation given upon being appointed post-mistress. Section 3834 of the U. S. Revised Statutes (being act of 3d March, 1877), enacts, inter alia: " The bond of any married woman who may be appointed postmaster shall be binding upon her and her sureties, and she shall be liable for misconduct in office, as if she were sole.” In Thompson on Liability of Stockholders, sec. 227, it is said : “ The general rule is, that transfers to a transferee incapable of taking are void, as to creditors and non-assenting shareholders, and the transferror remains a contributory, as though no transfer had been made.” And see sec. 23 ,• also Lindley on Partnership, page 836 (*1091). A married woman could not, at common law, make a valid power of attorney, Drury vs. Foster, 2 Wall., 20, and a married woman is not estopped to deny the validity of a mortgage. Same, 34: see, also, Lewis vs. Cammack, 15 Wall., 648. On the trial in the circuit court, counsel for plaintiff seemed to rely upon the decision of the Circuit Court of the United States for the Eastern District of Pennsylvania, in the case of Anderson vs. Jesse M. Line and Mary L., his wife, 14 Fed. R., 405. The defense in that case was based solely on the ground that the defendant was a married woman, and that as such she could not, under the laws of Pennsylvania, make a valid contract of the kind sued upon. It seems to have been conceded there that she actually owned and held stock in a national bank at the date of its failure, and that the certificate representing the stock had been obtained for her, and was delivered to, and was held by her. In the present case the defendant never received or saw the certificate of transfer, and did not hold it either herself or by her agent, and nearly the whole of it was transferred on the books of the savings bank to her by her husband. No proof was offered at the trial to sustain the replication to the plea of coverture ; no attempt was made to prove that the defendant ever paid anything for the stock out of her own funds or out of any funds. So far as the proof upon which the case was submitted goes, the transfer was wholly without consideration, and therefore, in such a case it must be held to be a subterfuge and a fraud. Not a word of proof was tendered by the plaintiff to establish the averment of ownership, or to show that the stock appertained to the separate estate of the married woman. This omission was not an oversight; there was and is no proof that the defendant ever bought or .bargained for the stock, or that she ever held or paid one cent for it; the transfer was made for some ulterior purpose not disclosed at the trial. Because of the absence of evidence to show that the stock was owned by her as her separate estate, and because of the presence of undisputed evidence that nearly all of it was transferred on the books by the husband, the president of the bank, to his wife, the court directed a verdict for the defendant; this was clearly right. .; The cases are abundant to show that formal and fraudulent transfers of the stock of national banks will be disregarded, and the true owner held on his statutory liability. Hitz was clearly the owner of this stock. See National Bank vs. Case, 99 U. S., 62; Davis vs. Stevens, 17 Blatchf., 259. The fact, which is undisputed, that the husband, in each instance, collected and appropriated to his own use the proceeds of the dividend checks, is a strong circumstance towards proving that the stock was his, and not the property of his wife. There was no proof offered to show that the certificates made out in the name of the defendant were ever shown to her or brought to her attention, or that they ever passed out of the hands of the savings bank. The ordinary way of transferring this kind of stock is by endorsement and delivery of the certificate; when the owner endorses and delivers the certificates for a consideration, the title passes to the purchaser, and no transfer can be made except on surrender of the certificate. Bank vs. Lowrie, 11 Wall., 369; Johnson vs. Laflin, 103 U. S., 800. [MAJORITY — Mr. Justice Cox] Mr. Justice Cox delivered the opinion of the court. Ou the 24th of September, 1872, the German American Savings Bank was incorporated under the General Incorporation Acts of May 5 and June 17,1870, with a capital of $127,000. On the 21st of January, 1876, John Hitz transferred to the defendant, Jane O. Hitz, his wife, 173 shares of the stock of that bank, of the par value of $17,300. On the same day, Win. E. Mattingly transferred 10 shares, E. B. Donaldson, 10 shares, and O. E. Prentiss, 7 shares, of the stock to Mrs. Hitz, thus making her the owner of 200 shares, of the par value of $20,000. In further proof of the ownership, three checks were put in evidence, dated respectively, May 1, 1876, November 1, 1876, and May 1, 1877, each for $800, signed by C. E. Prentiss, cashier, in favor of Mrs. Hitz, for dividends upon the stock in her name, all apparently indorsed by her to her husband. On the 7th da}^ of May, 1877, a paper was signed apparently by all the stockholders, including Mrs. Plitz, authorising and empowering the trustees to change and convert the savings bank into a national banking association, under acts of Congress in such case made and provided, and to execute the articles of association and organization certificate required by the statute, &c., the new bank to bear the name of the German American National Bank of Washington. On the 14th of May, 1877, J. S. Langworthy, acting comptroller of the currency, executed the certificate required by law, that the German American National Bank of Washington is authorized to commence the business of banking, as provided in section 5169 Bov. Stat. It does not appear that auy new stock book was opened, •or new certificates of stock issued in the name of the new bank, but the books of the old bank were transferred to the new, and the stockholders in the old, were assumed to be •stockholders in the new bank. Sworn lists of these stockholders of the German American National Bank, were, from time to time, furnished to the Comptroller of the Currency, in conformity with law, all of which included Mrs. Hitz’s name. On the 20th of October, 1878, the German American National Bank, of Washington, failed and suspended payment, and the plaintiff was appointed receiver of the bank, by the comptroller of the currency. On the 11th of June, 1880, the comptroller certified that, •upon an examination of the affairs of the bank, he found it necessary to enforce the individual liability of the shareholders of the bank, as provided b3r act of Congress, and thereupon ordered and made an assessment upon them to the amount of one hundred dollars per centum of the par value of the shares held by them respective!}'. On the same day the receiver notified Mrs. Hitz of this assessment and requested payment of $50 on each share of her stock within 30 days, and $50 more within 60 days, and these payments not having been made, the receiver instituted this suit against Mrs. Hitz, to recover the sum of $20,000. The defendant filed pleas : 1. That she was never indebted ; 2. That she never owned or held any stock of the German American National Bank ; 3. And that she is, and has been, since August 5, 1856, a feme covert. To the third plea, plaintiff' replied that the stock was the .property of the defendant, owned by her in her own right, with the consent and permission of her husband. The defendant, by leave, filed a fourth plea, denying the •existence of such a corporation as the German American .National Bank. At the trial the court directed a verdict for the defendant.. The first question made in argument here, relates to the legality of the conversion of the savings bank into the-national bank. It is maintained for the defence that there is no authority of law for such conversion. Section 5154, Rev. Stats., euacts : “ That any bank incorporated by special law, or any banking institution organized under a general law of any State, may, by authority of this act, become a national association,” &c. This applies in terms, only to banks in the Slates where they are organized under general laws, and if the term u special law ” is not confined to State laws, it would not embrace the casé of a bank organized under a general law of Congress, as was the case with the German American Savings Bank of this District. But by act of Congress of June 30, 1876, it was enacted that: “All savings or other banks, now' organized, or which shall hereafter be organized in the District of Columbia under any act of Congress, which shall have capital stock paid up in whole or in part shall be subject to all the provisions of the Revised Statutes, and of all acts of Congress applicable to national banking associations, so far as the same may be applicable to such savings or other banks ; provided, that such savings banks now established shall not be required to have a paid-up capital exceeding one hundred thousand dollars.” It might be a question whether this act does not, by its own operation, and without the necessity of any action by the banks, convert them at once into national banks, or, at least, engraft upon their charters all the features of a national bank, not inapplicable to or inconsistent with them, of which the individual liability of shareholders would be one. Such has not been the practical interpretation of the law, but it has been supposed, at least, to authorize the conversion of the banks in this District into national banks, and this interpretation has been acted on repeatedly. It is maintained here, however, that the provision in the banking act for the conversion of other banks into national banks is not applicable to savings banks. The reasoning on the subject is entirely theoretical and founded on the difference in the objects and operations of the two kinds of banks. The question, however, will have to be determined by an interpretation of the acts of Congress, and it seems to us to be very clearly determined by the proviso, above cited, in the act of June, 1876, taken in connection with the prior acts. The banking act provides, with reference to associations originally organized under it, “ that no association shall be organized under this title with a less capital than one hundred thousand dollars.” (Sec. 5188 Rev. Stat.) Section 5154, which provides for the conversion of existing banks into national banks, enacts that, “ no such association shall have a less capital than the amount prescribed for associations organized under this title.” A capital of $100,000 was made a condition precedent to the original organization of a national bank, and to the conversion of another bank into one. The requirement of such a capital by the act is for no other purpose, and has reference to no other object. Then the proviso in the act of June 30,1876, that such savings banks, now established (i. e., in this District), shall not be required to have a paid-up capital exceeding one hundred thousand dollars necessarily assumes and implies that the conversion feature in the national banking act, which requires such capital, would be applicable to such savings banks in the District of Columbia. It would have, otherwise, no meaning. It is substantially an enactment, that the laws relating to national banks, including the conversion provision, shall be applicable to savings and other banks in this District, except that savings banks now existing shall not be obliged to have a capital of $100,000 in order to be converted into national banks. ' • We are satisfied, therefore, that it was competent for the German American Savings Bank to avail itself of the provision in the law for conversion into a national bank. And the certificate of the comptroller of the currency is conclusive, according to the decision of the Supreme Court in Casey vs. Galli, 94 U. S., 673, as to the regularity of the proceedings by which that conversion was effected. We may add, that according to the same decision, where a shareholder of a corporation is called upon to respond to a liability as such, he is not permitted to deny the existence or the legal validity of such corporation. It is not, therefore, open to the defendant to rely upon this defense, if she is in the position of an ordinary shareholder in this bank. Mrs. Hitz was a shareholder in the Savings Bank, as far as the books and transfers show. Excluding Mrs. Hitz, the ■owners of more than two-thirds of the stock consented to the conversion into a national bank and such conversion, according to the statute, took place without reference to her concurrence. She then became entitled to an equivalent amount of stock in the national bank. It would perhaps have been more regular for a new stock book to be opened and new certificates to be issued in the name, of the national bank. There is, however, nothing in the law, prescribing the form of the stock book or of the certificates of stock, and we see nothing to prevent the new bank from treating the ■old books and certificates as sufficient evidence of title in the new concern. Neither the rights nor liabilities of the stockholders could be effected by the mere omission to issue a new form of stock certificate to them. To hold otherwise would be to allow all the stockholders to escape liability, by the mere omission of the formality of issuing the shares in a new form. All this is clear enough when applied to shareholders in the savings bank, who were, sui juris, capable of consenting and w,ho actually did consent to the change. But suppose the case of a shareholder who did not consent, or was not capable of consenting, to the conversion, and who did not, in fact, receive any certificate of stock in the new bank. Although, without his consent, the legal metamorphosis of the bank might be complete, could he be properly considered a stockholder in the new bank? For example, Mrs. Hitz, received no certificate of stock in the new bank, nor is any act of hers shown in connection with it, after its organization. If she became a stockholder in it at all, it must have been in virtue of her consent that her original stock should be converted into stock of the national bank. If she could consent to this, she was as much a stockholder in this new bank as the other original shareholders of the savings bank, notwithstanding any omission to issue new certificates. If not, it would be difficult to make out her membership in the new concern. How far, then, was she capable of giving that consent ? As to part of this stock, to the amount of $2,700, it was, prima facie, acquired during marriage, otherwise than by gift or conveyance from her husband. It may be that he paid the consideration for it, and that it was really his gift, but that is not the present aspect of the case. As to this much of the stock, then, under the Married Woman’s Act of 1869, her right to it was as absolute as if she were unmarried ; she could convey, devise and bequeath it in the same manner and with like effect as if she were unmarried, and might contract, sue and be sued in her own name, in all matters having relation to it, in the same manner as if she were unmarried. If so, she could consent, like a feme sole, to its conversion into national bank stock, and take that in exchange for it, with all the incidents of such ownership. We have little difficulty, then in holding upon the present showing, that quoad this stock, the defendant was a feme sole and sui juris, and is amenable to all the consequences of its ownership and conversion which a feme sole would be, including the liability asserted in this action. The larger part of the savings bank stock was transferred to the defendant immediately by her husband. We see no legal difficulty in the way of the husband’s making this transfer, so as to vest the legal title to his wife. With his assent, she might acquire title by purchase from strangers, and except where it interferes with the rights of his creditors, there is no reason why he may not transfer the legal title to any of his property into her name, except that at common law a conveyance of realty could not be made directly from him to her. He, however, may have his own shares of stock cancelled and new ones issued to his wife,, and her title will be the same as if they were derived from a stranger. She has the legal capacity to receive gifts, may be the obligee of a bond or receive a transfer of stock in moneyed corporations, and this, though the consideration may have proceeded wholly from the husband, and in such case she may hold against the legatees and heirs, but not against the creditors of the husband. Fisk vs. Cushman, 6 Cush., 20. If, however, this property is not given to her sole and separate use, which I assume to be the ease here, because there is nothing to indicate the contrary, it would still be subject to the husband’s common law rights. Stock of an incorporated company is a chose in action. The husband has but a qualified property in it — a right to reduce it to his possession by transferring it into his own name or selling it. A mere collection of the dividends would not be a reduction to his possession of the principal. Burr vs. Sherman, 3 Bradf., N. Y., 85. But.until it is reduced to his possession it remains the wife’s property, and survives absolutely to her, on her husband’s death before her. But, on the other hand, the wife cannot, during coverture, transfer her own choses in action of her own motion. And if Mrs. Hitz undertook, on her own responsibility, to convert her shares of savings bank stock, given to her by her husband, into national bank shares, all which involves a transfer of choses in action, in which the husband has a qualified property, it would probably have to be held a void proceeding. Yet it must be deemed settled law that a wife may transfer her choses in action, with the consent of her husband. It has been held, for example, that a bill of exchange or promissory note, payable to a married woman, may be endorsed in her own name, and the title passed, with the husband’s consent. Menkins vs. Hernight, 17 Mo., 287; McLain vs. Weidmeyer, 25 Mo., 364. A transfer in exchange for other choses in action would seem to be clearly within the same rule. If, therefore, Mrs. Hitz acted with her husband’s consent, in agreeing to convert her savings bank stock into national bank stock, of which the fact of their uuiting in the same power of attorney, for that object, would seem to be evidence, we have a regular and legal acquisition by her of the stock of the German American National Bank. Does the usual consequence of that ownership devolve upon her, as to that part of the stock which she holds, only as a married woman would hold it, at common law, i. e., the personal liability to be assessed for losses to the amount of the par of the stock ? Section 5151, Rev. Stat., provides that : “ The shareholders of every national banking association shall be held individually responsible, equally and rateably, and not one for another, for all contracts, debts and engagements of such association, to the extent of the amount of their stock therein, at the par value thereof.” We can conceive a state of facts to which this would not apply, even where one is a nominal shareholder. If, for instance, the stock had been transferred to Mrs. Hitz, and the subsequent change made in the bank without her knowledge or consent, it would be a very forced construction of the law which would extend it to such a case. But we assume for the argument, that the contrary was the case, since evidence was admitted without objection, tending to show that she received dividends on the stock and consented in writing, as a stockholder, to the change. The statute contains no exception, in terms, in favor of married women. It seems hard, and therefore difficult to conceive that Congress intended that a married woman, acquiring her stock, it may be under marital influence, and also unable to alien it herself, should yet be held liable, in consequence of that ownership, to make good, out of her other estate, losses resulting from failure of the bank. Tet we find even a harder case clearly enacted in the statute : “ Persons holding stock as executors, administrators, guardians or trustees, shall not be personally subject to any liability as stockholders; but the estates and funds in then-hands shall be liable in like manner and to the same extent as the testator, intestate, ward or person interested in such trust funds would be if living and competent to act and hold the stock in his own name.” Sec. 5152 Rev. Stat. So that a young ward, whose guardian invests in national bank stock, without his knowledge or consent, and even where he is incapable of assenting at all, is liable, in hie other estates under the individual liability clause in the statute. This very difficulty was considered by the Court -of Appeals of New York, in the case entitled, “ In the matter of the Reciprocity Bank,” 22 N. Y. R., 15, which arose undeia statute of New York relating to State banks, similar to-the U. S. statute, and in substantially identical terms. The court said : “The legislature, if it had thought proper to do so, might have made an exception in favor of married woman, but no such exception was made. It is said that Mrs. Lansing, being under the disabilities of coverture, could not make a transfer of her shares and so avoid this liability, if she had wished to do so. This is a circumstance which might have been properly addressed to the legislative discretion if, indeed, the legislature had any discretion, under the injunction of the constitution, but it does not authorise the courts to allow an exemption, where neither the constitution nor the law has declared any. It is also said that femes coverts are not liable to suit at common law ; and, in general, this is true. It is also true that the apportionment of liability among stockholders in banks, when duly confirmed, becomes a judgment against each stockholder, to be enforced by execution as in other cases. But it was competent for the legislature to depart from the rules and analogies of the common law, and to make married women and their estates liable in this proceeding as other shareholders in banks are made liable. This, we think, has been done, in order to effectuate the policy in which the constitutional provision and the statute are founded. It might go far to defeat that policy, if married women could take and hold stock without liability to creditors.” In the same case, in the Supreme Court of New York, reported in 29 Barb., 382, it had been laid down that “ married women eoulcl own stock in bank in their own right both at common law and under the statute of 1848 (of New York), and the legislature had the power to alter the common law so as to make them personally liable to the amount of their stock. It has thought proper to do so, and we are bound in this,'as in all other cases, to enforce their liability.” In the case of Anderson vs. Line, in the U. S. Circuit Court for the Eastern District of Pennsylvania, reported in 14 Fed. Reporter, 405, it appeared that shares of stock in a national bank were transferred by a husband directly to his wife, as in this case, and that suit was instituted against her and her husband. And the court held that the coverture did not exempt her from the liability imposed by the national currency acts upon all stockholders in national banks. So that, whatever authority exists on this question is all in the direction of the feme covert's liability. It is obvious, as suggested in the New York case, that to maintain an exemption of married women from liability would greatly facilitate an evasion of the individual liability clause and the practice of frauds against creditors. It would only be necessary for husbands to put the stock in the names of their wives. Again, sec. 5139 provides that a transferee of stock shall succeed to the rights and liabilities of the prior holder. If a married woman transfers the stock, and she is not liable, it might be held that her transferee is equally exempt. These are. some of the serious difficulties in the way of sustaining the exemption of married women as shareholders. In a general way, some of the cases speak of the liability of the shareholder as a contract liability, from which its nonexistence is argued in favor of persons not competent to contract to assume that liability. But it will be found that the terms “ contract liability ” are used in the sense of being a liability which will survive against the estate, instead of dying with the person, as would a liability for a mere tort. In our view, however, and that is evidently held in the case already referred to, it is a liability imposed by statute, as an incident to the ownership of the stock, and attaching to all who are capable of that ownership, and without reference to any supposed voluntary assumption of the liability by express or implied contract. And as this is a statutory and not a common law liability, imposed - upon the feme covert as a shareholder, it seems to us, as was also held in 29 Barbour, supra, that it affects her alone, and we think that suit is properly brought against her without joining her husband, which would be necessary in the enforcement of any common law obligation or liability of the wife. The court below having held the wife’s coverture a protection to her, it follows from the views before stated, that a new trial must be ordered.